StemCells, Inc. (NASDAQ:STEM) announced today its expected addition to the Russell 3000^® Index on June 26, 2009, when Russell Investments reconstitutes its comprehensive set of U.S. and global equity indexes. The Russell 3000 Index is a broad market index that measures the performance of the 3000 largest companies in the United States. As part of its membership in the Russell 3000, StemCells would automatically be included in the Russell 2000^® Index, which is a subset of the Russell 3000 representing the small capitalization segment of the U.S. equity market. With the expected addition of StemCells, the number of stem cell companies in the Russell 3000 will be increased to four.

Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for both passive and active investment strategies. It is estimated that $4 trillion in assets are currently benchmarked to Russell indexes.

About StemCells, Inc.

StemCells, Inc. is a clinical-stage biotechnology company focused on the research, development and commercialization of products derived from stem cell technologies. In its therapeutic product development programs, StemCells is focused on developing cell-based therapeutics to treat diseases of the central nervous system and liver. StemCells’ lead product candidate, HuCNS-SC^® cells, are highly purified human neural stem cells which can be expanded and banked until they are delivered as patient doses. StemCells has completed a Phase I clinical trial of HuCNS-SC cells as a potential treatment for neuronal ceroid lipofuscinosis (NCL), a rare and fatal neurodegenerative disease that affects infants and young children. The trial data demonstrated that the HuCNS-SC cells were well tolerated by the trial participants. StemCells has also received approval from the U.S. Food and Drug Administration to initiate a Phase I clinical trial of the HuCNS-SC cells as a potential treatment for Pelizaeus-Merzbacher Disease (PMD), a rare and fatal brain disorder that primarily affects young children. StemCells, through its wholly owned subsidiary Stem Cell Sciences UK Ltd, is also pursuing applications of its cell-based technologies to develop research and drug screening tools, such as cell-based assays, media and reagent tools, which the Company believes represent nearer-term commercial opportunities. StemCells has exclusive rights to approximately 55 issued or allowed U.S. patents and approximately 200 granted or allowed non-U.S. patents.